What to Anticipate in 2011 Regarding Food Prices
We could see food price increases in the next year.
One reason comes from the United States Department of Agriculture (USDA). Food prices will rise about 2 percent in the near term, “substantially less” than increases caused by previous surges in farm-commodity costs, suggests Agriculture Secretary Tom Vilsack.
While food commodity prices have risen, high crop prices don’t automatically raise food prices. This is because commodity costs comprise less than 20 percent of every dollar a U.S. consumer spends on food, Vilsack said recently. Still, some increases are inevitable as producers pass along higher expenses, he said.
As of the middle of November (2010), wheat, corn and soybean futures in Chicago are all up at least 15 percent this year on higher exports and tighter supplies than expected earlier this year. The USDA on Oct. 25 forecast food inflation of 2 percent to 3 percent next year and estimated this year’s increase to be 0.5 percent to 1.5 percent.
Vilsack also said the U.S. is trying to increase trade with India and anticipates continued export opportunities with China.
